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Reading: Tesla Could Limit Cybertruck Output Like Ferrari to Sustain Prices
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Mobility

Tesla Could Limit Cybertruck Output Like Ferrari to Sustain Prices

Osama Khalid
Last updated: February 12, 2024 1:44 pm
Osama Khalid
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2 Min Read
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  • Tesla may limit initial Cybertruck output like Ferrari to sustain prices.
  • This scarcity strategy hedges bets amid production hurdles and unproven demand.
  • Slow ramp alleviates manufacturing issues while keeping customers hungry.

Contents
Intentional ScarcityAlleviates production bottleneck

Tesla’s divisive Cybertruck may see Ferrari-like production caps initially to maintain scarcity value despite booming reservations.

CEO Elon Musk could limit volumes, at least at first, while ironing out manufacturing issues.

Intentional Scarcity

Wall Street forecasts just 48,500 Cybertrucks sold in 2024 as output increases slowly. Morgan Stanley sees 108,000 sold combined in the first two years – a fraction of over 1 million pre-orders.

Intentional scarcity could sustain excitement and pricing power if demand persists. Musk may take a page from Ferrari’s playbook of constrained vehicle runs.

The strategy also counters risks of oversupply if Cybertruck reservations collapse amid its polarizing design, climbing price tags, and unproven production.

Apple’s iPhone X launch similarly faced early output challenges. Analysts say calculated supply caps offset the uncertainties of manufacturing complex new global products.

Alleviates production bottleneck

For the Cybertruck’s radical departure from standard trucks, initial limitation allows time to resolve production hurdles. All while keeping customers hungry as marketing buzz builds.

If demand craters once models hit the street, Tesla avoids surplus inventory it can’t sell. However, strong interest would let it steadily scale output to meet orders later.

The approach sustains exclusivity and margins but requires flawless execution. And Apple’s launch issues showed the tactic doesn’t always pan out.

Still, purposefully metered volumes hedge Tesla’s bets on the sci-fi pick-up disrupting an entrenched Detroit. As Musk likes to say, building cars is hard, but excitement sells.

TAGGED:div5

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